Participant FAQs Registration with CGSO

 

To whom does the Consumer Protection Act apply?

A supplier is any person who markets goods and services in the ordinary course of their business.

This includes government and large municipalities, businesses (company, CC, sole proprietors etc), clubs, trade unions, associations and societies.

It does not apply to private sellers of homes and motor vehicles but may apply to a landlord even if it is not their full time occupation.

Which businesses are covered by the Consumer Goods and Services Ombud Scheme?
Do we have to pay to be participants in the Consumer Goods and Services Ombud Scheme?
What happens if we refuse to participate in the Consumer Goods and Services Ombud Scheme?

You will be in contravention of section 82(8) of the CPA.

See Participant obligations

What are the obligations of participants in the Consumer Goods and Services Ombud Scheme?
What should we do if a complaint is referred to us by the Consumer Goods and Services Ombud Scheme?

STAGE 3: COMPLAINT RESOLUTION BY THE PARTICIPANT

11.3. Intervention by the Participant

11.3.1. If a Complainant is referred to a Participant by the CGSO in terms of clause 11.2.7.6 above, the Participant shall:

11.3.1.1. contact the Complainant to clarify any issue, to ascertain the essence of the Complaint and to attempt to settle the Complaint to the reasonable satisfaction of the Complainant;

11.3.1.2. if able to resolve the Complaint, provide CGSO with reasonable proof that the Complaint has been settled and that any undertaking made by the Participant has been compiled with;

11.3.1.3. undertake any investigate that is necessary; the level of investigation should commensurate with the seriousness, frequency of occurrence and severity of the Complaint;

11.3.1.4. if the Participant is unable to resolve the Complaint referred to it by the CGSO in terms of clause 11.2.7.6, provide the CGSO with a report outlining the investigation that it undertook and the reasons that the matter was not resolved and its reasons for repudiating the Complaint

How do we register as participants of the Consumer Goods and Services Ombud Scheme?

Participants can join online by clicking here.

Who must register?

All participants in the consumer goods and services industry supply chain whose activities are regulated by the Consumer Protection Act.

Who or what is exempt?

Transactions that are not covered by the CPA and/or that are governed by other public regulation; the automotive industry, Electronic Communication Service as defined in section 1 of the Electronic Communications Act, 2005 (Act No. 36 of 2005) and transactions with organs of state or financial institutions; anyone regulated elsewhere or belonging to another ombud scheme. Sometimes an entity can be subject to other regulation but still be required to comply with the Consumer Protection Act.

What if the product we produce is already covered by the entity/retailer that is already subscribed to CGSO?

Everyone in the supply chain is jointly and severally liable: CGSO can decide which party is liable.

When did it become compulsory for qualifying entities to register with the CGSO

Registration with the CGSO became mandatory on 29 April 2015 after the Minister of Trade and Industry published the Code in a Government Gazette. Once you have completed your registration the CGSO bills as from 1 May 2015 pro rata for the rest of its financial year.

What must we pay?
Group Turnover Range New Annual Fee
Group 1 R3 bil + 200 000
Group 2 Above R1 bil to R3 bil 120 000
Group 3 Above R500 mil to R1 bil 40 000
Group 4 Above R5 mil to R500 mil 3 360
Group 5 Above R1 mil to R5 mil 1 680
Group 6 R1 to R1 mil no cost

*New fees as of March 2018

To register a a participant:

Click here to download the participant form.
Click here to view a full list of registered participants.
Click here to view Code obligations on Participants
How must we prove our turnover?

You can provide CGSO with a copy of your latest financials or a letter from your auditors.

What if we are a group of companies/ some of them are not in the CGS space?

Kindly submit a detailed motivation delineating the relevant activities for our consideration.

What if we have no complaints against us?

The Code and the Consumer Protection Act does not exempt on this basis and as a result all qualifying entities are required to subscribe. We comment on the fees in our special addition newsletter: Download Here

What are the consequences of not subscribing to the CGSO and paying the Subscriptions fees?

You will be in contravention of section 82(8) the Consumer Protection Act and your non participation may be considered an aggravating factor should your company appear before the National Consumer Tribunal which has the power to levy fines of up to 10% of annual turnover. The Code also empowers the CGSO to sue companies that refuse to pay their participation fees.

Who else has registered with CGSO?
Why is someone else we know not registered?

Non-compliance with the law by one party is not a defence for another party. You are encouraged to make the CGSO aware so that we can engage with the relevant entity.

What are our obligations in terms of the Code?

The Code requires participants to carry out the following responsibilities:

  • Establish an effective Internal Complaints-Handling Process
  • Monitor processes for the internal complaints-handling procedure and effectiveness.
  • Display prominently on all their trading premises by means of the CGSO decal
  • Ensure that a copy of this Code and/or summary hereof and their Internal Complaints-Handling Process is made available to any Consumer upon request and/or the Consumers are directed as to where to obtain a copy of the Code and/or their Internal Complaints-Handling Process.
  • Ensure that the relevant staff and agents in their business have adequate knowledge of the CPA and the Regulations issued thereunder, including the Code and their own Internal Complaints-Handling Process.
  • Ensure, where possible, that they keep proper records for a minimum of 3 (three) years of the complaints that are received with the following details captured:
  • Co-operate with all reasonable requests made by the CGSO in a timely manner. Any failure to cooperate with the CGSO may be taken into consideration by the NCC and the Tribunal when issuing a compliance notice or proposing or determining an administrative fine.

See Participants Code

What benefits do we get if we join?

Besides complying with the law your participation will demonstrate to your customers that you care about the needs and this will give you a competitive edge. Below is a list of the benefits:

  • Display “Buy With Confidence” Decal On The Supplier’s Window/Door/ Website
  • Last Chance To Resolve < Escalation To NCC
  • Expert Advice (email Help Desk)
  • Free Product Testing Where Disputes Arise
  • Feedback/ Risk Management
  • Supply Chain Dispute Facilitation
  • Industry Workshops
  • Access to CPA training by CGSO staff
  • Case Studies/ Advisory Notes/ Benchmarking
  • Speedy, Confidential Dispute Settlement

See: Why the CGSO?

Once we fill in the participation form when is payment due?

You will be sent an invoice; payment should be made once you receive it.

Why were we not consulted regarding the Code?

The Consumer Goods Council of South Africa spearheaded a consultative process within the consumer goods and services industry broadly to take advantage of the opportunity created by the CPA to co-regulate by developing a code of conduct and creating an ombud See 2012 Annual Report This culminated in the first publication of the Code for comment in early 2013 by the Department of Trade and Industry. This was accompanied by a launch function that attracted considerable media attention. The NCC thereafter followed a process of consultation as mandated by the CPA. The revised Code was published on 3 October 2014 and further public comment was received and considered, this time by the dti. The final version of the Code was then published as law on 30 March 2015. It is up to businesses to track developments in the law that affect them.

Who in the supply chain is liable for defective goods?

In terms of section 56 of the Consumer Protection Act there is an implied warranty that the producer, importers, the distributor and retailer each warrant that the goods sold comply with the requirements and standards contemplated in section 54. The implied warranty extends beyond the boundaries of contractual privity as all warrant the quality of the goods. Further to this Section 61 provides for a strict liability delictual framework enabling consumers to obtain redress from the producer, importer, distributor or retailer where they have been injured or have sustained property damage because of a safety defect in a product.

Can CGSO give legal advice to suppliers?

CGSO provides training to suppliers and educate them on the provisions of the Consumer Protection Act. We also have advisory notes to guide suppliers and consumers as to their rights and obligations under the Consumer Protection Act (CPA). We cannot provide legal advice and all information received from the CCGSO is merely a guidance, you must still seek legal advice on all your legal matters.

Do suppliers have the right to inspect defective goods?

Whether a supplier is entitled to submit returned goods for technical inspection before making a call on whether to refund/ replace is not dealt with expressly in the CPA. Suppliers in some instances request such an inspection in order to establish whether the defect was caused by consumer abuse. An inspection might also reveal whether the fault is insignificant and accordingly that the supplier has the right to repair it instead of replacing it, if this cannot be determined readily in the store.
Conversely, the CPA also does not say that it will be presumed that any defect that manifests within 6 months was present in the goods at the time of sale. So if suppliers simply denied liability, consumers would have to prove the defect was pre-existing and they would be forced to go through the CPA dispute resolution process. In most instances it would be necessary for the entity dealing with the complaint (ombudsman, Commission or Tribunal) to call for the item to be submitted for inspection, in order to make a call.

If the goods are defective can the supplier elect to repair or replace?

The choice is the consumers: the supplier cannot force a consumer to opt to have the goods repaired if the consumer prefers a refund or replacement unless the defect is insignificant or minor. The consumer can insist on a cash refund instead of a store credit or vouchers, or on a replacement with something similar at no additional cost. The supplier may not force the consumer to purchase a more expensive model or brand. The supplier must bear the costs of repairing, collecting and/ or replacing the defective goods and may not charge for usage or wear and tear on the returned product.